Credit: (AP Photo/Mary Altaffer)

From buses to trains, the head of New Jersey Transit detailed Wednesday exactly how the COVID-19 pandemic changed ridership patterns and continues to shape the agency’s long-range fiscal projections.  

For now, the statewide bus and rail system has enough funding to get through the fiscal year that begins July 1 with a balanced budget and no fare increases, even as overall ridership remains about 25% lower than pre-pandemic levels. 

But looking ahead, agency documents project budget shortfalls in future fiscal years as NJ Transit’s significant federal pandemic aid begins to run out.  

Story continues after the table.

During testimony before the Assembly Budget Committee , NJ Transit Executive Director Kevin Corbett said weekday rail ridership is fluctuating between 55% and 75% of pre-pandemic levels, depending on the day of the week, with Mondays and Fridays now lighter travel days. 

Buses back to 80% ridership 

Meanwhile, bus ridership is more than 80% back to pre-pandemic levels, with intrastate routes seeing the best “rate of return,” Corbett said. Weekend rail ridership appears to be another bright spot, with some trains fully recovered, he said.  

But with federal aid expected to run dry before there is a full rebound in overall bus and rail ridership, Corbett said mass transit agencies throughout the country are facing the same financial predicament. He also suggested the issue may require more federal intervention given the scale of the problem nationwide. 

“This is not a burden that can be fixed solely on a state level,” Corbett said.  

Even if lawmakers go along with Murphy’s proposal, the size of the annual subsidy would still fall well below the $457.5 million that NJ Transit received out of the state budget as recently as the 2019 fiscal year, according to budget documents. 

For his part, Gov. Phil Murphy has proposed increasing the subsidy for NJ Transit that comes out of the state’s annual budget by $40 million, to $140 million, as part of an overall $53.1 billion spending plan he proposed for the 2024 fiscal year.  

Murphy administration officials also said last month that fare hikes and service changes are now on the table as they begin to confront the agency’s long-term fiscal challenges.  

Money talk 

The proposed increase in the annual state subsidy for NJ Transit represents a 40% change year-over-year. But even if lawmakers go along with Murphy’s proposal, the size of the annual subsidy would still fall well below the $457.5 million that NJ Transit received out of the state budget as recently as the 2019 fiscal year, according to budget documents.  

Moreover, the Murphy administration’s ongoing efforts to reduce oft-criticized funding transfers that redirect money from capital resources and the state’s Clean Energy Fund to support NJ Transit’s annual operating budget will also have an impact on the bottom line. The agency is also facing increased costs due to contractual obligations, Corbett said during Wednesday’s meeting in Trenton.  

The agency’s 2024 fiscal year spending plan is balanced without any fare hikes, but a budget shortfall of $119 million is expected in the 2025 fiscal year and $917 million the next year, he said.  

Corbett, who has served as the agency’s executive director throughout Murphy’s tenure, which began in early 2018, promised to take on NJ Transit’s fiscal challenges with “the same zeal and commitment we demonstrated when faced with the dire operational challenges when I first arrived.”  

Long-term prospects 

Concerns about NJ Transit’s long-term fiscal trajectory predate the challenges posed by the pandemic. Even before the onset of the health crisis, an audit commissioned by the Murphy administration labeled NJ Transit’s funding as “inadequate, uncertain, and unsustainable.” 

Such concerns have led many transportation advocates who have long faulted the practice of supporting operating budgets with funds diverted from capital resources and the Clean Energy Fund to renew calls for a permanent and dedicated source of stable state funding for NJ Transit. 

‘We all have ourselves, up here, to blame for this, as well, because it’s been years coming.’ — Assemblyman Raj Mukherji  

During a question-and-answer portion of Wednesday’s budget meeting, there was some discussion of establishing a dedicated source of state funding for NJ Transit operations, and some lawmakers suggested the agency’s looming fiscal challenges should trigger a “sense of urgency.” 

“We all have ourselves, up here, to blame for this, as well, because it’s been years coming,” Assemblyman Raj Mukherji (D-Hudson) said.  

However, on the capital side of NJ Transit’s budget ledger, the situation appears to be more stable thanks to increased state and federal funding for long-term infrastructure investments, according to budget documents.  

During Wednesday’s budget meeting, Corbett outlined some of NJ Transit’s ongoing capital investments, including for station projects in Elizabeth, Lyndhurst and Perth Amboy, and the replacement of the Portal Bridge spanning the Hackensack River in north Jersey.  

“In total, NJ Transit is advancing 66 projects that are currently underway in design or construction,” Corbett said.   

— Graphic by Genesis Obando